The 7 Dos and Don’ts of Making & Paying Yourself Passive Income

Today I’m writing about the 7 Dos and Don’ts of Making & Paying Yourself Passive Income.

If you know me, you understand that I’ve been making and paying myself passive income for the last 10 years or so.

So I’m someone who actually walks the talk.

This blog post is based on my personal experiences, and what I went through to finally quit my day job and become a full time mother and wife, and continue investing and creating more passive income investments on a part time basis.

#1 Do and Don’t of Making and Paying Yourself Passive Income

DO GET STARTED

It’s important to just start. I started by reading financial magazines. That’s were I learned that there were stocks called REITs and that they paid dividends that were pretty high.

I started investing by buying $100 or so in shares and just watching to see what it would do. Happily, it paid dividends!

DON’T DELAY

You might think that you can wait to get started, but hear me out. When you wanted to drive a car, as soon as you were able didn’t you want to learn how right away?

Didn’t you practice?

That’s how you got good at driving right?

If you don’t drive, then think of something else that you really wanted to learn…and that feeling of wanting to get started right away…so that you could get good at it!

It’s the same with learning how to make passive income.

#2 Do and Don’t of Making & Paying Yourself Passive Income

DO TRUST OTHERS

If you are going to do something new, you have to trust people who can teach you how to do what you want to do.

Sometimes people get shut off in talking about money to others, or receiving information about money from others.

However, in order to learn how to make passive income, you are going to have to open up your mind to new ideas from others.

It’s important to understand that the wealthy have been making passive income for thousands of years already. This isn’t something new.

It’s just new to you.

So find people who are creating passive income and learn from them.

Learn to trust others and learn about passive income!

DON’T LEAVE IT TO OTHERS

What you don’t want to do is give all your money over to someone else, unless they are a very trusted advisor.

I’ve noticed that there are a lot of business opportunities out there that are not really passive income investments, that tend to suck a lot of people’s money.

I’ve also noticed that there are a lot of financial advisors that do not know how to make passive income, nor do they pay themselves passive income.

Do not give control of your money to anyone else.

Keep control of your own money.

#3 Do & Don’t of Making & Paying Yourself Passive Income

DO RESEARCH

Want to learn how to make passive income?

Just do some research!

Read books.

Read magazines.

Research publicly traded companies.

Learn about passive income investments!

DON’T PUT ALL YOUR EGGS IN ONE BASKET

If you find a good investment, do not put all your money in it, especially if you are a beginner investor.

Make small tester investments to get used to investing and learn what you are doing first.

All investments have risk.

If you put it all in one investment when you are just a beginner, you may lose it all.

#4 Do & Don’t of Making & Paying Yourself Passive Income

DO TAKE SMALL STEPS

Start investing with small amounts of money.

Learn as you go.

See what you like, what you don’t like.

DON’T THINK YOU KNOW IT ALL WITH A GOOD INVESTMENT

Let’s say you found an investment that seems good, that doesn’t mean that you know everything.

That investment might be good now and bad tomorrow.

Or maybe it will stay good, for reasons that you don’t understand.

Or maybe it’s just luck.

Every great investor knows there are no guarantees that an investment will remain good if it is good now.

So don’t think you know it all when you make your first good investment.

#5 Do & Don’t of Making & Paying Yourself Passive Income

DO EVALUATE RISK

Be sure you understand what you could make in a return, but also what you might lose.

A lot of good investors won’t go into a deal if there is a high likelihood that they will lose their money.

Be sure that the investment has the right risk level to you.

If you don’t want to lose your money, then stick to savings accounts and other safer and more conservative investments.

DON’T GAMBLE

Gambling is not investing.

If you are at your lowest and feel like you have to go to Vegas to hit it big or it’s over, then you are no longer investing…you’re gambling.

You might as well just give your money away, because gambling is not investing.

If you want to make passive income, stay away from gambling.

#6 Do & Don’t of Making & Paying Yourself Passive Income

DO KEEP A BASE IN SAVINGS

It’s important to have enough money in savings that you feel emotionally stable.

If you have enough money in savings, you are less likely to do very risky investments.

You will know that you have money, and not act desperately.

So keep at least 3 months of your income in savings and leave it there to accumulate interest.

Enjoy the peace of mind it will give you.

DON’T PUT IT ALL ON RISKY INVESTMENTS

Think of Bitcoin in 2017.

People were going crazy for it, and even taking 2nd mortgages out of their houses to buy mining machines and crypto currency.

Then it tanked in 2018, and people lost their money.

Everyone knew that bitcoin was risky.

Understand what is high risk and don’t put all your money in risky investments.

If you put your money in a high risk investment, you have to be ok with losing it all.

So be sure most of your passive income investments are more conservative.

#7 Do & Don’t of Making & Paying Yourself Passive Income

DO PAY YOURSELF

When you start making passive income, pay it to yourself!

What does that mean?

Take the interest / dividends / royalties / etc and put that passive income into your checking account to pay for your everyday expenses.

Pay yourself your passive income!!!

DON’T REINVEST EVERYTHING

Most people don’t pay themselves passive income because they think they have to reinvest everything.

If you want to enjoy passive income, you have to pay yourself at least some of it!

Let your IRA or 401K do the reinvesting.

Have a separate investment account that you can use to invest, create passive income that you can actually pay yourself!

Trust me, that’s what makes investing fun =)

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About Mey Duldulao

Back in 2011 I had over $30,000 in credit card and line of credit debt, was living paycheck to paycheck and was stressed out over my lack of success in my financial life.

In April of 2016, I became debt free and had a monthly passive income stream. I quit my job on December 23, 2016, and started doing my dream work of mentoring others on what I did to create the freedom to quit my job.

In 2017 we bought our first condo in Waikiki, and we went on 5 weeks of vacation (including a 7 day cruise to the Mexican Riviera)!!!

In 2018 we bought our first investment property!

In 2018 we converted our first condo into our 2nd investment property.

I spend most of my time doing what I dreamed of for years, spending my days with my son Jordan and my husband Jomel, enjoying motherhood and being a wife. I also enjoy researching Financial Freedom and sharing what I learn with my clients and on my blog.

If you want to learn more about how I can help take back control of your money and your time, then CLICK HERE, watch the free video and get started!